ApeCoin: After 25% gains in two days, investors should beware…

Warning: The conclusions of the following analysis are the sole opinions of the author and should not be taken as investment advice.

ApeCoin (APE) has performed remarkably well over the past three days while recovering in an ascending (yellow) channel on its 4-hour chart. After its substantial plunge, buyers re-entered the market around the $10.6 mark and pulled the price from its multi-week lows.

Going forward, sellers may try to block this phase of high volatility and put barriers at the resistance of $13.3. Buyers needed to respect the boundaries of the current bullish channel to avoid a downturn. At press time, APE was trading at $13.4298, up 11.14% in the past 24 hours.

4 hour APE chart

Source: TradingView, APE/USDT

Shortly after the Bored Ape Yacht Club introduced its new crypto “ApeCoin” on March 17, it sparked considerable interest in the public eye.

After an exponential jump after its launch, the crypto found itself hovering between $10 and $15 over the past month. The most recent from the $10 base saw several bullish engulfing candles line up on the APE 4-hour chart.

As a result, 20 EMA (red) quickly accelerated from 50 EMA (cyan) and projected a bullish edge on the charts. This growth led the price to continue testing the upper band of the Bollinger Bands (BB) while entering high volatility.

As the trendline resistance (white) coincided with the horizontal resistance at $13.3, the bears would likely aim to pull the price towards the lower trendline of the rising channel. A break below this pattern could cause a test of the $12.7 level support. The 20-EMA would likely offer support for a potential breakdown.

Reasoning

Source: TradingView, APE/USDT

For the most part, the bullish RSI matched the price and rose in an uptrend channel. A conceivable reversal of the overbought mark would position the RSI for a southerly trajectory.

Further, the CMF projected a bullish edge as the recent rally reclaimed the zero line. Now the bulls were looking to test the 0.06 resistance ahead of a trend entry move.

As the Aroon up (yellow) and Aroon down (blue) indicators reached their highs, APE price might face a slight setback.

Conclusion

Given the confluence of several resistances in the $13 area, APE may face a short-term decline. A break below its current pattern could rekindle downtrends. In this case, the bulls had to keep the support of the 20 EMA intact.

Even then, investors/traders need to consider the general market sentiment and on-chain developments to make a profitable decision.